Between the Lines

Among the comments heard at the Fasig-Tipton Kentucky July yearling sale were two that were neither profound nor lengthy, but nonetheless quite significant. From Patrick Lawley-Wakelin: "People were more prepared this year." From Walt Robertson: "It is a good time to own a horse."

Both require reading between the lines.

What Lawley-Wakelin, a British-born, Virginia-based bloodstock agent, was alluding to was 2004 being the second consecutive year Keeneland canceled its July auction that traditionally had led off the yearling selling season.

For many, it is hard to imagine a world without a Keeneland July sale, where so many top yearlings were sold over the years. But you had better get used to it.

"Last year, it just didn't have time to sink in," Lawley-Wakelin said of Keeneland's decision. "This year, people understood and they arrived here more prepared."

Buyers speak at auctions by bidding, and Keeneland heard their speech pattern loud and clear. Fasig-Tipton heard them too, and its selection process for the July sale was its answer. Buyers found a solid group of horses going through the ring at an auction with very few soft spots. And they arrived ready to buy racehorses. That is evident by the fact the median rose 19%. When the price at which half the horses cost less and half cost more jumps from $67,000 to $80,000, the buyers are sending a clear signal: We have nothing against pedigree, but give us horses that are early foals, mature, and well conformed.

When the FTK summer sale grossed $41.3 million for 390 yearlings in 1983, the market was rolling through a heady time when anything with four legs and black type was in demand. It is more impressive when a sale stressing conformation in today's landscape sees its second-highest gross ever, $38.6 million paid July 19-20 for 338 yearlings.

When Robertson, the president of Fasig-Tipton, said it is a good time to own a horse, he implied is it is a good time to own a good horse. The current market emphasizes top dollar for a good product and a much different scenario for many other offerings.

It has not always been this way.

Many observers remember when a horse purchased today was automatically worth more if sold tomorrow. Now, consignors are being asked to place realistic reserves and understand that a smaller profit margin is acceptable for a horse that is small or has a physical problem.

But the Fasig-Tipton auction showed Robertson is right--it is a good time to own a horse. Consignors can't expect to consign eight yearlings and hit eight home runs. But there is no better place to appraise horses than the auction ring, so what they can expect is realistic prices as judged by today's horsemen.

That 75% of the horses that went through the auction ring found new homes is evidence they understand that.

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